PEO Insider Issue

Cowabunga! Riding the Waves of Opportunity

“Cowabunga!” This slang from 1960s surf culture is the joyful cry of a surfer climbing a 12-foot wall of water and getting ready to “take the drop.”

It’s also the joyful cry of a PEO salesperson following a small business trend and getting ready to close some major business.

Opportunities for both surfers and PEO salespeople come in waves. Surfers know that everything that goes into making a good wave is not evident on the water’s surface. Surfers must know their surf spot geography, keep an eye on local weather conditions, and be aware of the tides. To PEOs, the small business market is like the ocean—constantly moving, with waves visible as they near shore, but their duration and strength somewhat of a mystery.

Departments

Sales

It’s not surprising that one of the most common questions asked of NAPEO is: How do I recruit, educate, and manage salespeople? Once a PEO has its core product offerings in place, the ultimate success of the PEO will be based on how successfully it attracts and retains clients through its sales efforts. This article will cover the basics of creating an internal sales operation, although for those PEOs who use PEO brokers, the same processes could apply.

Risk Management

When a client company employee is injured and a contract is in place with a PEO, it’s hard to envision a greater mutual incentive than the employee’s prompt return to work. After all, no company or PEO wants to enter into a contract when workers are continually struggling with health recovery, incurring avoidable medical costs, and not spending time on the job being as productive as possible.

Legal Currents

Do you receive or maintain any personal information, or health related information, of a Florida resident? If so, there has been a dramatic change in a Florida statute that most likely applies to you, and failure to comply will result in substantial penalties. On June 20, 2014, Florida Governor Rick Scott signed into law the Florida Information Protection Act of 2014 (FIPA) after it received unanimous support by the legislature. FIPA took effect on July 1, 2014, and will replace Florida’s existing data breach notification law. FIPA dramatically increases the breadth of Florida’s data breach notification law. This article highlights these new requirements.

Healthcare

On June 30, 2014, the U.S. Supreme Court issued its decision in Burwell v. Hobby Lobby Stores, Inc., and ruled that certain regulations issued by the U.S. Department of Health and Human Services (HHS) imposing the contraceptive mandate violate the Religious Freedom Restoration Act of 1993 (RFRA) under certain circumstances. The court’s decision received an enormous amount of media attention—but there was also a great deal of misinformation about what the Hobby Lobby case really means for employers.

Columns

Up Front

PEO clients have lower employee turnover rates and lower rates of business failure than comparable national averages, after controlling for factors such as industry, size, and state of location, according to the data analyses reported in the second release in NAPEO’s white paper series, “Professional Employer Organizations: Keeping Turnover Low and Survival High.”

Small Business Perspective

To run a successful business takes a great deal of hard work, determination, and resilience. Many say that we see fewer of the young generation exhibiting these traits and that the entrepreneurial spirit is on the decline.

PEO Index

After turning sharply downward in the first quarter of 2014, the PEO Employment Index has recovered substantially in the intervening months. The economy in the first quarter was decidedly very weak, even after considering the unusually harsh winter weather to which many attributed the weakness.

NAPEO Notebook

As I write this, we at NAPEO are totally consumed with preparations for the Annual Conference & Marketplace to be held September 15 to 17 in Miami, Florida. Hopefully, you are sitting in the Fontainebleau as you read this.

NAPEO Advisor

Q. Why are FUTA rates varying by state?
A. The federal unemployment tax (FUTA) rate is 6 percent of the first $7,000 of a worker’s income; a credit of 5.4 percent generally reduces this rate to .6 percent (or $42 per worker).

The Inside Word

It is hard to believe: this will be my final note as NAPEO chairman of the board. I realize it is a cliché to say it, but it is astounding how quickly the year has gone! However, the calendar does not lie: our annual conference approaches and with that exciting event (http://acm14.napeo.org/acm14/index.cfm), my tenure will come to an end.

Global Insights

Recently, the Dodd-Frank Act—a sweeping law intended to reform our financial regulatory system—turned four years old. But it’s no milestone to celebrate. Dodd-Frank has become the poster child for all that’s wrong with our regulatory system, which errs on the side of excess, overreach, complexity, and costliness.

Capitol Comment

This column is supposed to report on the activities of Congress and their impact on the PEO industry. Because that column would be a one-sentence update, I will instead report on what Members of Congress are really focused on: the November election.

#napeo30

Every industry has it pioneers, and for an industry as young as the PEO industry, many of them continue to be involved. Generally, these pioneers and leaders are well known to most of their industry colleagues, but some avoid the spotlight and prefer to lead quietly with no fanfare.